GBP/AUD Exchange Rate Lifted by UK Retail Data
The Pound Australian Dollar (GBP/AUD) exchange rate trended higher on Thursday, following the release of some stronger-than-expected UK retail data.
At the time of writing the GBP/AUD exchange rate has risen 0.3% this morning, lifting the pairing to a new one-month high.
Pound (GBP) Exchange Rates Rise, Strong UK Retail Sales Figures to Bolster Q4 Growth?
The Pound (GBP) was buoyed against many of its peers on Thursday morning as markets reacted to the release of the UK’s latest retail sales figures.
According to data published by the Office for National Statistics (ONS), UK retail sales growth rebounded from -0.4% to 1.4% in November, sailing past forecasts of a more modest 0.3% expansion, thanks to Black Friday offers.
The ONS reported:
‘Retailers reported strong growth on the month due to Black Friday promotions in November, which continues the shifting pattern in consumer spending to sales occurring earlier in the year.’
The surge in sales growth will be welcomed by GBP investors, amid hopes the strong sales may help to prop up GDP in the fourth quarter.
Australian Dollar (AUD) Stalls as Domestic Unemployment Rises
At the same time the Australian Dollar (AUD) found itself on the defensive overnight on Wednesday following the release of Australia’s latest labour report.
November’s data saw the Australian Bureau of Statistics (ABS) report that unemployment unexpected rose from 5% to 5.1% after a rise in the participation rate.
While a stronger-than-expected rise in employment was welcomed, it provided little relief to the ‘Aussie’ as they were mostly part-time positions.
GBP/AUD Exchange Rate Forecast: BoE’s Forward Guidance to Support Sterling?
Looking ahead, the Bank of England’s (BoE) upcoming rate decision is likely to have a more lasting impact on the Pound Australian Dollar (GBP/AUD) exchange rate.
While no changes to monetary policy are expected this month, the BoE’s final rate decision of the year will also outline the bank’s forward guidance for 2019.
This may lend some significant support to Sterling in the coming months if the recent upswing in wage growth results in the Bank signalling that it could accelerate the pace of monetary tightening next year as some economists forecast.
Meanwhile a lull in notable domestic data may lead the Australian Dollar to struggle to find momentum through the remainder of 2018, with the currency likely to be left at the mercy of market risk appetite.